City Developments Ltd. agreed to sell its majority stake in one of Singapore’s most iconic office complexes, according to a person familiar with the matter, as the developer seeks to reduce debt and regain investor confidence after a family feud rocked the firm.
CDL will sell its 50.1% stake in South Beach to minority owner IOI Properties Group Bhd, the person said, requesting not to be identified because the information is private. Malaysian developer IOI will have full ownership following the deal. The deal values the complex at about $2.75 billion, the person said.
An IOI spokesperson declined to comment. CDL didn’t immediately respond to an emailed query.
CDL has been under pressure to sell assets after a feud divided the Kwek family, the wealthiest clan in Singapore. Despite mending relations with his father and Chairman Kwek Leng Beng, the firm’s chief executive officer Sherman Kwek acknowledged in April that the dispute had hurt shareholders’ confidence, and said that reducing the growing debt load is a priority.
The deal will help CDL to meet a pledge to exceed the roughly $600 million in divestments it made in 2024, which fell short of a $1 billion target.
The complex in Singapore’s central business district includes retail space, a 34-story office tower, and a 45-story building housing a JW Marriott Hotel.
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The purchase adds to IOI’s growing presence in Singapore, with residential developments as well as assets like IOI Central Boulevard Towers, a newly opened city center office project. The Malaysia-listed firm is controlled by the Lee family, which made its fortunes from palm oil.
The South Beach development, designed by Norman Foster’s architectural firm, has seen ownership changes before. CDL bought the site for nearly $1.69 billion in 2007 along with two foreign partners, a unit of state-owned Dubai World Corp., and El-Ad Group Ltd. The global financial crisis led to a years-long delay in construction and the two partners exited the project, with IOI eventually taking a minority stake in 2011. The elder Kwek resisted allowing IOI to take an equal stake in order to maintain control, according to a biography published in 2023.
Major tenant Meta Platforms Inc. gave up its seven floors of space at the office tower last year, and occupancy dropped to 92.4% as of the end of March, compared with 94.4% at the end of last year.
